Ecopetrol Braces for Sharp Profit Decline Amid Falling Oil Prices

Bogotá, Colombia – Colombia’s state-run oil giant Ecopetrol is facing turbulent times as tumbling crude oil prices threaten to slash its profits by as much as 12 trillion pesos (approximately USD $2.76 billion) in 2025, according to company president Ricardo Roa.

Speaking at a recent industry forum, Roa detailed how sustained declines in global oil prices—driven in part by ongoing market uncertainty stemming from the U.S.-China trade conflict—could force Ecopetrol to shutter operations at numerous oil fields across the country. As of Friday, Brent crude futures were trading at $63.45 per barrel, marking two consecutive weeks of price drops and placing strain on producers operating at higher break-even costs.

“We already have a first list of fields that have a break-even point close to that price, so we’ll have to eliminate them and focus on those with lower costs,” Roa said during the event.

Production Cuts Loom

Roa revealed that between 20 and 30 oil fields are at risk of closure if prices do not recover. While he clarified that these sites are not among the company’s most productive assets, the closures could still signal a significant reduction in Ecopetrol’s overall output. Currently, the company manages a portfolio of 158 oil fields.

The financial implications of this trend are considerable. Roa explained that every $1 drop in the price of oil translates to a reduction of 900 billion pesos in EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), and a 700 billion peso hit to net profits.

“If we were considering $73 a barrel and now they’re at $63, then we have a difference of 12 trillion pesos in price,” Roa noted.

Wider Impact on Colombia’s Economy

The projected decline in profits carries broader macroeconomic consequences. Ecopetrol is a crucial contributor to Colombia’s national budget, and its earnings represent a significant portion of government revenue. With the state already grappling with rising public debt, weak tax collection, and enforced budgetary tightening, a slump in Ecopetrol’s income could further strain public finances.

This fiscal fragility places added urgency on the company to adapt swiftly to changing market dynamics.

Natural Gas Offers a Ray of Hope

Despite the challenges in the oil sector, Roa emphasized that Ecopetrol is forging ahead with plans to bolster natural gas production—a move aligned with long-term energy diversification goals.

Starting in June, the company will release additional volumes of locally sourced natural gas. By July, it is set to begin importing and distributing gas through Colombia’s Buenaventura port. These developments are part of a broader strategy to stabilize revenue streams and reduce dependency on oil markets.

Adding to the optimism, natural gas from an offshore block co-developed with Brazilian oil major Petrobras is projected to become operational by the end of 2025. Roa said this single project could meet up to 14% of Colombia’s current natural gas demand, making it a significant development in the country’s energy landscape.

Navigating a Volatile Market

Ecopetrol’s dual-track strategy—combining targeted oil field closures with aggressive natural gas expansion—underscores its commitment to resilience amid volatile global energy markets. While the road ahead may be uncertain, the company’s pivot toward diversification could provide a lifeline in weathering the storm.

As Colombia watches closely, the performance of its flagship energy company will have ripple effects far beyond the oil fields—touching everything from national budgets to consumer energy prices in the months ahead.

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